4 Top Utility Stocks Four Your Watch List Today
As we tread through a volatile stock market, investors could consider investing in utility stocks. For the uninitiated, utility stocks are companies that provide necessities such as electricity, water, gas, and waste management services. Understandably, these are essential services that everybody needs even during periods of inflation, war, or pandemic. Therefore, utility stocks tend to be more stable regardless of the state of the economy. And because of this, utility companies typically generate steady earnings, allowing them to provide decent dividend payouts. Hence, this makes utility stocks a safer, lower-risk option for investors.
Take Dominion Energy (NYSE: D) for example. Earlier this month, the energy company announced that it will be increasing its dividends to $0.67, a 6% increment from the year before. Accordingly, this will take the dividend yield to 3.2%. Elsewhere, investors could look at Sempra Energy (NYSE: SRE). Yesterday, Fitch Ratings affirmed Sempra Energy’s long-term issuer default rating at ‘BBB+’. Fitch cites stable cash flows from its utility business and its long-term contracted infrastructure investments as the basis for this rating. And with that, here are four other utility stocks to consider in the stock market today.
Utility Stocks To Watch In The Stock Market Today
- Vidler Water Resources Inc. (NASDAQ: VWTR)
- Waste Management Inc. (NYSE: WM)
- Essential Utilities Inc. (NYSE: WTRG)
- Duke Energy Corporation (NYSE: DUK)
Vidler Water Resources
Kicking off our list of utility stocks today is Vidler Water Resources, or Vidler for short. Essentially, it is a water resource company that focuses on developing reliable water supply in geographic areas lacking available water resources. Vidler provides water development solutions for end-users by identifying, acquiring, and developing water rights, often within fragmented agricultural markets. Over time, the company will convert these water rights to higher valued municipal and industrial uses. In the past year, VWTR stock has increased by over 70%.
Last week, the water resource company reported its financial results for the fourth quarter ended December 31, 2021. For starters, it raked in $23.44 million for the quarter, a stark year-over-year increase from the $3.46 million in 2020. This massive differential is thanks to the company’s significant sale of 55,000 long-term storage credits (LTSC) from its storage facility in Arizona. The sale generated approximately $22 million in revenue for Vidler. Besides, net income came in at $33.68 million, triple the amount of $10.1 million in the prior year. Given the strong quarterly performance, should you invest in VWTR stock?
Another top utility stock to watch today is Waste Management (WM). As its name suggests, the company is a leading provider of comprehensive waste management services in North America. It provides services that range from collection and disposal to recycling and renewable energy generation. Impressively, its environmental services span nearly 21 million residential, industrial, and commercial customers. And with 26,000 collection and transfer vehicles, the company has the largest trucking fleet in the waste industry. Together with its competitor Republic Services (NYSE: RSG), the two handle more than half of the garbage collection in the U.S. What’s more, WM stock has risen by over 24% over the past year.
In February, WM announced its fourth-quarter earnings for 2021. Revenue came in at a record $4.68 billion, a 15% increase from the $4.07 billion it brought in the prior year. As for its profits, WM earned $528 million on an adjusted basis, a 9.8% year-over-year increase. This translates to diluted earnings per share of $1.26. In addition to this, the company provided its 2022 outlook. Total company revenue growth is expected to range from 5.8% to 6.2%. This includes organic growth from the collection and disposal business of approximately 6%. Considering the stellar results, would you buy WM stock?
Following that, we have Essential Utilities, or Essential for short. It is one of the largest publicly traded water, wastewater, and natural gas providers in the U.S. For a sense of its reach, the company serves approximately 5 million people across 10 states under the Aqua and Peoples brands. Furthermore, with over 130 years of experience in the industry, Essential also has a track record of regulatory compliance, operational efficiency, and environmental stewardship. Despite moving sideways for most of the past year, WTRG stock appears to be gaining attention lately. It has risen by about 10% over the past month.
Earlier this month, the company’s Aqua Pennsylvania subsidiary acquired the wastewater system of Lower Makefield Township. The wastewater system, costing $53 million, serves approximately 11,000 customer connections in townships throughout Pennsylvania. Notably, this brings Aqua Pennsylvania’s total number of customer connections to more than 500,000. In addition to Lower Makefield, the company currently has seven more signed purchase agreements for water and wastewater systems. These seven agreements come to a total of more than $418 million and represent approximately 224,000 retail customers or dwelling units. Given this acquisition, should you keep an eye on WTRG stock?
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Finally, we have Duke Energy. Being one of the largest electric power holding companies in the U.S., Duke provides energy to 7.9 million customers in six states. In fact, it has approximately 51,000 megawatts of power generating capacity in the Carolinas, Midwest and Florida, and a natural gas distribution system that serves more than 1.6 million customers. On top of that, Duke’s commercial business owns and operates a diverse portfolio of renewable energy facilities. In the past month, DUK stock has increased in price by about 11%. What could be the catalyst for its recent movement?
On March 10, Duke’s subsidiary Duke Energy Florida announced the successful completion of three battery storage projects in Gilchrist, Gulf and Highlands counties. This will provide a reliable backup power solution for consumers as well as reduce dependence on the grid. Evidently, the three projects have a capacity of more than 34 megawatts and will build upon Duke’s strategic plans. Furthermore, Duke intends to build six more battery sites in Florida, boasting a total capacity of 50 megawatts of energy storage. Ultimately, this will expand Duke’s growth prospects in the booming battery storage market. With that being said, should you be adding DUK stock to your portfolio?